Document Type : Original Article
Department of accounting, Damavand branch, Islamic Azad University, Damavand, Iran
Department of Accounting, Damavand Branch, Islamic Azad Univercity, Damavand, Iran.
Department of psychology, Behshahr branch, Islamic Azad University, Behshahr, Iran
The present study aimed to explain the relationship between IQ and earnings management by considering managers' narcissism. The research method was applied in terms of objective and correlational-descriptive in terms of method. IQ was an independent variable and earnings management (accrual, real and scenario) was a dependent variable. In addition, narcissism was considered as a moderating variable. The statistical population included at least one member of the board of directors or financial managers of 112 companies on the Tehran Stock Exchange in 2017. Jones’ modified model was used to measure accrual earnings management, three-part model of Roy Choudhury (2006) was used to measure real earnings management, and a questionnaire derived from Clikeman and Henning (2000) was used to measure scenario earnings management. The tool used for testing IQ was the 36-item adult IQ test of Raven. In addition, two methods of face width measurement and NPL 16 narcissistic personality inventory were used to measure narcissism. In order to analyze the results, a structural model with covariance-based pls software was used. The results indicated that the relationship between IQ and earnings management (real and accrual) considering narcissism had a significant coefficient, while this relationship with scenario-based earnings management was not significant. Based on the extracted results, IQ is an effective factor in earnings management provided that narcissism is not a trait of the manager.